Key Facts

• Bitcoin's volatility index, DVOL, is trading at 41.5%, which is well below February's peak of 90% but not as cheap as May's lows, according to Deribit.
• A $10.5 billion option expiry deadline is nearing on Friday, which is considered one of the most significant liquidity events on the annual calendar, according to Jean-David Péquignot, chief commercial officer at Deribit.
• The implied volatility for calls is significantly cheaper than for puts, making call spreads, a bullish strategy, relatively attractive, with Péquignot noting that call spreads "remain attractive for anyone wanting recovery exposure into the post-quarterly reset".
• The sharp decline in Alphabet and SpaceX stocks, and declines in Asian equity indexes, could stoke volatility in bitcoin, which often takes its cue from technology stocks.
• The Fed's preferred inflation measure, the core PCE, is scheduled for release on Thursday and is expected to show price pressures at their strongest since May 2024, which may breed volatility across assets, including Treasury notes and cryptocurrencies.